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Treasury Confirms It - Govt Borrowing For Super

27 June 2001

Treasury Confirms It - Govt Borrowing For Superfund

Treasury has today confirmed that the government would have to borrow most of the contributions to the Superfund over the next five years.

National's Finance spokesman Bill English says the truth came out at a hearing of the Finance and Expenditure Select Committee today.

"Dr Cullen has consistently denied that the Superfund will mean more government borrowing. But today his position was undercut by his own officials.

"Budget tables show the government plans to borrow $7.6 billion over the next five years to pay for its investments. In that same period Dr Cullen's plan calls for the government to pay $6.1 billion into the Superfund.

"Treasury officials today confirmed that if there were no contributions to the Superfund the government would only be borrowing $1.5 billion.

"Treasury officials also confirmed that it doesn't make sense to borrow for saving.

"Borrowing to invest in the Superfund is like increasing your mortgage to buy shares. You might come out ahead, but you might lose the lot.

"It certainly isn't smart to rely on that kind of investment," Bill English said.

Ends




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